Exhibit 10.3
DENTSPLY International Inc.
2002 Amended and Restated Equity Incentive Plan
SECTION 1 PURPOSE
The purpose of the DENTSPLY International Inc. 2002 Amended and
Restated Equity Incentive Plan (originally named the "DENTSPLY International
Inc. 2002 Stock Option Plan") (the "Plan") is to benefit DENTSPLY International
Inc. ("DENTSPLY") and its "Subsidiaries," as defined below (hereinafter referred
to, either individually or collectively, as the "Company") by recognizing the
contributions made to the Company by officers and other key employees,
consultants and advisers, to provide such persons with an additional incentive
to devote themselves to the future success of the Company, and to improve the
ability of the Company to attract, retain and motivate such persons. The Plan is
also intended as an additional incentive to members of the Board of Directors of
DENTSPLY (the "Board") who are not employees of the Company ("Outside
Directors") to serve on the Board and to devote themselves to the future success
of the Company. "Subsidiaries," as used in the Plan, has the definition set
forth in Section 424 (f) of the Internal Revenue Code of 1986, as amended (the
"Code"). The original effective date of the Plan was March 22, 2002 ("Effective
Date"). An amendment and restatement of the Plan was approved by the Board as of
March 22, 2005, to change the name of the Plan to the "2002 Amended and Restated
Equity Incentive Plan", to provide for the grant of restricted stock, restricted
stock units and stock appreciation rights to eligible participants and to make
conforming changes in other provisions.
Stock options which constitute "incentive stock options" within the
meaning of Section 422 of the Code ("ISOs"), stock options which do not
constitute ISOs ("NSOs"), stock which is subject to certain forfeiture risks and
restrictions ("Restricted Stock"), stock delivered upon vesting of units
("Restricted Stock Units") and stock appreciation rights ("Stock Appreciation
Rights") may be awarded under the Plan. ISOs and NSOs are collectively referred
to as "Options." Options, Restricted Stock, Restricted Stock Units and Stock
Appreciation Rights are collectively referred to as "Awards." The persons to
whom Options are granted under the Plan are hereinafter referred to as
"Optionees." The persons to whom Restricted Stock, Restricted Stock Units and/or
Stock Appreciation Rights are granted under the Plan are hereinafter referred as
to "Grantees."
SECTION 2 ELIGIBILITY
Outside Directors shall participate in the Plan only in accordance with
the provisions of Section 5. The Committee (as defined in Section 3) shall
initially, and from time to time thereafter, select those officers and other key
employees of the Company, including members of the Board who are also employees
("Employee Directors"), and consultants and advisers to the Company, to
participate in the Plan on the basis of the importance of their services in the
management, development and operations of the Company. Officers, other key
employees and Employee Directors are collectively referred to as "Key
Employees."
SECTION 3 ADMINISTRATION
3.1 The Committee
The Plan shall be administered by the Human Resources
Committee of the Board or a subcommittee thereof ("Committee"). The
Committee shall be comprised of two (2) or more members of the Board.
All members of the Committee shall qualify as "Non-Employee Directors"
as defined in Rule 16b-3 under the Securities Exchange Act of 1934, as
amended (the "1934 Act"), or any successor rule or regulation,
"independent directors" as defined in Section 4200(15) of the
Marketplace Rules of The Nasdaq Stock Market and "outside directors" as
defined in Section 162(m) or any successor provision of the Code and
applicable Treasury regulations thereunder, if such qualification is
deemed necessary in order for the grant or the exercise of Options
under the Plan to qualify for any tax or other material benefit to
Optionees or the Company under applicable law.
3.2 Authority of the Committee
Subject to the express provisions of the Plan, the Committee
shall have sole discretion concerning all matters relating to the Plan
and Awards granted hereunder. The Committee, in its sole discretion,
shall determine the Key Employees, consultants and advisors to whom,
and the time or times at which, Awards will be granted, the number of
shares to be subject to each Award, the expiration date of each Award,
the time or times within which the Option may be exercised or
forfeiture restrictions lapse, the cancellation or termination of the
Award and the other terms and conditions of the grant of the Award. The
terms and conditions of Awards need not be the same with respect to
each Optionee and/or Grantee or with respect to each Award.
The Committee may, subject to the provisions of the Plan,
establish such rules and regulations as it deems necessary or advisable
for the proper administration of the Plan, and may make determinations
and may take such other actions in connection with or in relation to
the Plan as it deems necessary or advisable. Each determination or
other action made or taken pursuant to the Plan, including
interpretation of the Plan and the specific terms and conditions of the
Award granted hereunder by the Committee, shall be final, binding and
conclusive for all purposes and upon all persons.
3.3 Award Agreement
Each Award shall be evidenced by a written agreement or grant
certificate specifying the type of Award granted, the number of shares
of Common Stock, par value $.01 per share ("Common Stock") to be
subject to such Award and, as applicable, the vesting schedule, the
exercise or grant price, the terms for payment of the exercise price,
the expiration date of the Option, the restrictions imposed upon the
Restricted Stock and/or Restricted Stock Units and such other terms and
conditions established by the Committee, in its sole discretion, which
are not inconsistent with the Plan.
SECTION 4 SHARES OF COMMON STOCK SUBJECT TO THE PLAN
4.1 Subject to adjustment as provided in Sections 4.1 and 4.2, Options,
Restricted Stock, Restricted Stock Units and Stock Appreciation Rights
with respect to an aggregate of seven million (7,000,000) shares of
common stock, par value $.01 per share of DENTSPLY (the "Common Stock")
(plus any shares of Common Stock covered by any unexercised portion of
canceled or terminated stock options granted under the DENTSPLY
International Inc. 1993 Stock Option Plan or 1998 Stock Option Plan),
may be granted under the Plan (the "Maximum Number"). The Maximum
Number shall be increased on January 1 of each calendar year during the
term of the Plan (as set forth in Section 16) to equal seven percent
(7%) of the outstanding shares of Common Stock on such date, in the
event that seven million (7,000,000) shares is less than seven percent
(7%) of the outstanding shares of Common Stock on such date, prior to
such increase. Notwithstanding the foregoing, and subject to adjustment
as provided in Section 4.2, (i) Options with respect to no more than
one million (1,000,000) shares of Common Stock may be granted as ISOs
under the Plan, (ii) no more than two million (2,000,000) shares may be
awarded as Restricted Stock or Restricted Stock Units under the Plan,
and (iii) in any calendar year no Key Employee shall be granted Options
or Stock Appreciation Rights with respect to more than five hundred
thousand (500,000) shares of Common Stock or Restricted Stock and
Restricted Stock Units in excess of 150,000 shares of Common Stock. Any
shares of Common Stock reserved for issuance upon exercise of Options
or Stock Appreciation Rights which expire, terminate or are cancelled,
and any shares of Common Stock subject to any grant of Restricted Stock
or Restricted Stock Units which are forfeited, may again be subject to
new Awards under the Plan. For the avoidance of doubt, the amendment
and restatement of the Plan does not increase the Maximum Number and
notwithstanding any adjustment in the Maximum Number, as provided
above, all Awards granted under the Plan on or following the Effective
Date, subject to forfeitures or cancellation, shall be counted towards
the Maximum Number.
4.2 The number of shares of Common Stock subject to the Plan and to Awards
granted under the Plan shall be adjusted as follows: (a) in the event
that the number of outstanding shares of Common Stock is changed by any
stock dividend, stock split or combination of shares, the number of
shares subject to the Plan and to Awards previously granted thereunder
shall be proportionately adjusted, (b) in the event of any merger,
consolidation or reorganization of the Company with any other
corporation or corporations, there shall be substituted on an equitable
basis as determined by the Board of Directors, in its sole discretion,
for each share of Common Stock then subject to the Plan and for each
share of Common Stock then subject to an Award granted under the Plan,
the number and kind of shares of stock, other securities, cash or other
property to which the holders of Common Stock of the Company are
entitled pursuant to the transaction, and (c) in the event of any other
changes in the capitalization of the Company, the Committee, in its
sole discretion, shall provide for an equitable adjustment in the
number of shares of Common Stock then subject to the Plan and to each
share of Common Stock then subject to Award granted under the Plan. In
the event of any such adjustment, the exercise price per share of any
Options or Stock Appreciation Rights shall be proportionately adjusted.
SECTION 5 GRANT OF OPTIONS TO OUTSIDE DIRECTORS
5.1 Grants
All grants of Options to Outside Directors shall be automatic
and non-discretionary. Each individual who becomes an Outside Director
(other than an Outside Director who was previously an Employee
Director) shall be granted a NSO to purchase nine thousand (9,000)
shares of Common Stock on the date he or she becomes an Outside
Director. Each individual who is an Employee Director and who
thereafter becomes an Outside Director shall be granted automatically a
NSO to purchase nine thousand (9,000) shares of Common Stock on the
third anniversary of the date such Employee Director was last granted
an Option. Thereafter, each Outside Director who holds NSOs granted
under this Section 5 and is re-elected to the Board shall be granted an
additional NSO to purchase nine thousand (9,000) shares of Common Stock
on the third anniversary of the date such Outside Director was last
granted an Option.
5.2 Expiration
Except to the extent otherwise provided in or pursuant to
Section 11, each Option shall expire, and all rights to purchase shares
of Common Stock shall expire, on the tenth anniversary of the date on
which the Option was granted.
5.3 Exercise Price
The exercise price of each NSO granted to an Outside Director
shall be the "Fair Market Value," on the date on which the Option is
granted, of the Common Stock subject to the Option. For purposes of the
Plan, "Fair Market Value" shall mean the closing sales price of the
Common Stock on The Nasdaq National Market, or other national
securities exchange which is the principal securities market on which
the Common Stock is traded (as reported in The Wall Street Journal,
Eastern Edition).
5.4 Vesting
Each such NSO shall become exercisable ("vest") with respect
to one-third of the total number of shares of Common Stock subject to
the Option on the first anniversary following the date of its grant,
and with respect to an additional one-third of the total number of
shares of Common Stock subject to the Option, on each anniversary
thereafter during the succeeding two years.
5.5 Restricted Stock, Restricted Stock Units and Stock
Appreciation Rights
Notwithstanding the foregoing, the Board of Directors may
determine that, in lieu of being granted NSOs as described in this
Section 5, an Outside Director shall be granted an Award of shares of
Restricted Stock, Restricted Stock Units and/or Stock Appreciation
Rights as described in Section 8 or 10 hereof which, at the time of
grant, for the same value as 9,000 Options as determined by the method
the Company uses to value Awards. In any such event, the restrictions
as to such Award of Restricted Stock and/or Restricted Stock Units
shall lapse, and any such Award of Stock Appreciation Rights shall
vest, in accordance with the vesting schedule set forth in Section 5.4.
SECTION 6 GRANTS OF OPTIONS TO EMPLOYEES, CONSULTANTS AND ADVISERS
6.1 Grants
Subject to the terms of the Plan, the Committee may from time
to time grant Options which are ISOs to Key Employees and Options which
are NSOs to Key Employees, consultants and advisers of the Company.
Each such grant shall specify whether the Options so granted are ISOs
or NSOs, provided, however, that if, notwithstanding its designation as
an ISO, all or any portion of an Option does not qualify under the Code
as an ISO, the portion which does not so qualify shall be treated for
all purposes as a NSO.
6.2 Expiration
Except to the extent otherwise provided in or pursuant to
Section 11, each Option shall expire, and all rights to purchase shares
of Common Stock shall expire, on the tenth anniversary of the date on
which the Option was granted.
6.3 Vesting
Except to the extent otherwise provided in or pursuant to
Section 11, or in the proviso to this sentence, Options shall vest
pursuant to the following schedule: with respect to one-third of the
total number of shares of Common Stock subject to Option on the first
anniversary following the date of its grant, and with respect to an
additional one-third of the total number of shares of Common Stock
subject to the Option, on each anniversary thereafter during the
succeeding two years; provided, however, that the Committee, in its
sole discretion, shall have the authority to shorten or lengthen the
vesting schedule with respect to any or all Options, or any part
thereof, granted under the Plan.
6.4 Required Terms and Conditions of ISOs
ISOs may be granted to Key Employees. Each ISO granted to a
Key Employee shall be in such form and subject to such restrictions and
other terms and conditions as the Committee may determine, in its sole
discretion, at the time of grant, subject to the general provisions of
the Plan, the applicable Option agreement or grant certificate, and the
following specific rules:
(a) Except as provided in Section 6.4(c), the exercise price per
share of each ISO shall be the Fair Market Value of a share of
Common Stock on the date such ISO is granted.
(b) The aggregate Fair Market Value (determined with respect to
each ISO at the time such Option is granted) of the shares of
Common Stock with respect to which ISOs are exercisable for
the first time by an Optionee during any calendar year (under
all incentive stock option plans of the Company) shall not
exceed $200,000.
(c) Notwithstanding anything herein to the contrary, if an ISO is
granted to an individual who owns stock possessing more than
ten percent (10%) of the total combined voting power of all
classes of stock of the Company, (i) the exercise price of
each ISO shall be not less than one hundred ten percent (110%)
of the Fair Market Value of a share of Common Stock on the
date the ISO is granted, and (ii) the ISO shall expire and all
rights to purchase shares thereunder shall cease no later than
the fifth anniversary of the date the ISO was granted.
6.5 Required Terms and Conditions of NSOs
Each NSO granted to Key Employees and consultants and advisers
shall be in such form and subject to such restrictions and other terms
and conditions as the Committee may determine, in its sole discretion,
at the time of grant, subject to the general provisions of the Plan,
the applicable Option agreement or grant certificate, and the following
specific rule: except as otherwise determined by the Committee in its
sole discretion with respect to a specific grant, the exercise price
per share of each NSO shall be not less than the Fair Market Value of a
share of Common Stock on the date the NSO is granted.
SECTION 7 EXERCISE OF OPTIONS
7.1 Notices
A person entitled to exercise an Option may do so by delivery
of a written notice to that effect, in a form specified by the
Committee, specifying the number of shares of Common Stock with respect
to which the Option is being exercised and any other information or
documents the Committee may prescribe. The notice shall be accompanied
by payment as described in Section 7.2. All notices, documents or
requests provided for herein shall be delivered to the Secretary of the
Company.
7.2 Exercise Price
Except as otherwise provided in the Plan or in any Option
agreement or grant certificate, the Optionee shall pay the exercise
price of the number of shares of Common Stock with respect to which the
Option is being exercised upon the date of exercise of such Option (a)
in cash, (b) pursuant to a cashless exercise arrangement with a broker
on such terms as the Committee may determine, (c) by delivering shares
of Common Stock held by the Optionee for at least six (6) months and
having an aggregate Fair Market Value on the date of exercise equal to
the Option exercise price, (d) in the case of a Key Employee, by such
other medium of payment as the Committee, in its sole discretion, shall
authorize, or (e) by any combination of (a), (b), (c), and (d). The
Company shall issue, in the name of the Optionee, stock certificates
representing the total number of shares of Common Stock issuable
pursuant to the exercise of any Option as soon as reasonably
practicable after such exercise, provided that any shares of Common
Stock purchased by an Optionee through a broker pursuant to clause (b)
above shall be delivered to such broker in accordance with applicable
law.
SECTION 8 STOCK APPRECIATION RIGHTS
The Committee may award shares of Common Stock to Outside
Directors, Key Employees and consultants and advisors under a Stock
Appreciation Right Award, upon such terms as the Committee deems
applicable, including the provisions set forth below:
8.1 General Requirements.
Stock Appreciation Rights may be granted in tandem with
another Award, in addition to another Award, or freestanding and
unrelated to another Award. Stock Appreciation Rights granted in tandem
with or in addition to an Award may be granted either at the same time
as the Award or, except in the case of Incentive Stock Options, at a
later time. The Committee shall determine the number of shares of
Common Stock to be issued pursuant to a Stock Appreciation Right Award,
the grant price thereof and the conditions and limitations applicable
to the exercise thereof.
8.2 Payment.
A Stock Appreciation Right shall entitle the Grantee to
receive, upon exercise of the Stock Appreciation Right or any portion
thereof, an amount equal to the product of (a) the excess of the Fair
Market Value of a share of Common Stock on the date of exercise over
the grant price thereof and (b) the number of shares of Common Stock as
to which such Stock Appreciation Right Award is being exercised.
Payment of the amount determined under this Section 8.2 shall be made
solely in shares of Common Stock, provided that, the Stock Appreciation
Rights which are settled shall be counted in full against the number of
shares available for award under the Plan, regardless of the number of
shares of Common Stock issued upon settlement of the Stock Appreciation
Right.
8.3 Exercise.
(a) Except to the extent otherwise provided in Section 11 or 12, or in
the proviso to this sentence, Stock Appreciation Rights shall vest
pursuant to the following schedule: with respect to one-third of
the total number of shares of Common Stock subject to the Stock
Appreciation Right on the first anniversary following the date of
its grant, and with respect to an additional one-third of the
total number of shares of Common Stock subject to the Stock
Appreciation Right, on each anniversary thereafter during the
succeeding two years; provided, however, that the Committee,
in its sole discretion, shall have the authority to shorten or
lengthen the vesting schedule with respect to any or all Stock
Appreciation Rights, or any part thereof, granted under the
Plan. Notwithstanding the foregoing, a tandem stock appreciation
right shall be exercisable at such time or times and only to the extent
that the related Award is exercisable.
(b) A person entitled to exercise a Stock Appreciation Right Award
may do so by delivery of a written notice to that effect, in a
form specified by the Committee, specifying the number of
shares of Common Stock with respect to which the Stock
Appreciation Right Award is being exercised and any other
information or documents the Committee may prescribe. Upon
exercise of a tandem Stock Appreciation Right Award, the
number of shares of Common Stock covered by the related Award
shall be reduced by the number of shares with respect to which
the Stock Appreciation Right has been exercised.
SECTION 9 TRANSFERABILITY OF OPTIONS AND STOCK APPRECIATION RIGHTS
Unless otherwise determined by the Committee, no Option or
Stock Appreciation Right granted pursuant to the Plan shall be
transferable otherwise than by will or by the laws of descent and
distribution or pursuant to a qualified domestic relations order as
defined by the Code.
SECTION 10 RESTRICTED STOCK AND RESTRICTED STOCK UNITS
The Committee may award shares of Common Stock to Outside
Directors, Key Employees and consultants and advisors under an Award of
Restricted Stock and/or Restricted Stock Units, upon such terms as the
Committee deems applicable, including the provisions set forth below.
10.1
General Requirements.
Shares of Common Stock issued or transferred pursuant to an
Award of Restricted Stock and/or Restricted Stock Units may be issued
or transferred for consideration or for no consideration, and subject
to restrictions or no restrictions, as determined by the Committee. The
Committee may establish conditions under which restrictions on shares
of Restricted Stock and/or Restricted Stock Units shall lapse over a
period of time or according to such other criteria (including
performance-based criteria) as the Committee deems appropriate. The
period of time during which shares of Restricted Stock and/or
Restricted Stock Units remain subject to restrictions will be
designated in the written agreement or grant certificate as the
"Restricted Period."
10.2 Number of Shares.
The Committee shall determine the number of shares of Common
Stock to be issued pursuant to an Award of Restricted Stock and/or
Restricted Stock Units and the restrictions applicable to the shares
subject to such Award.
10.3 Restrictions on Transfer and Legend on Stock Certificate.
During the Restricted Period, subject to such exceptions as
the Committee may deem appropriate, a Grantee may not sell, assign,
transfer, donate, pledge or otherwise dispose of the shares of
Restricted Stock or Restricted Stock Units. Each certificate for a
share of Restricted Stock shall contain a legend giving appropriate
notice of the applicable restrictions. The Grantee shall be entitled to
have the legend removed from the stock certificate covering the shares
of Restricted Stock subject to restrictions when all restrictions on
such shares lapse. The Board may determine that the Company will not
issue certificates for shares of Restricted Stock until all
restrictions on such shares lapse, or that the Company will retain
possession of certificates for shares of Restricted Stock until all
restrictions on such shares lapse.
10.4 Right to Vote and to Receive Dividends.
During the Restricted Period, except as otherwise set forth in
the applicable written agreement or grant certificate, the Grantee
shall have the right to vote shares of Restricted Stock and to receive
any dividends or other distributions paid on such shares of Restricted
Stock, subject to any restrictions deemed appropriate by the Committee.
The Committee may determine in its discretion with respect to any Award
of Restricted Stock Units that, in the event that dividends are paid on
shares of Common Stock, an amount equal to the dividend paid on each
such share shall be credited to the shares subject to Award of
Restricted Stock Units ("Dividend Credits"). Any Dividend Credits shall
be paid to the Grantee if and when the restrictions with respect to
such Restricted Stock Units lapse as set forth in Section 10.5.
10.5 Lapse of Restrictions.
(a) All restrictions imposed on Restricted Stock and/or Restricted
Stock Units shall lapse upon the expiration of the applicable
Restricted Period and the satisfaction of all conditions
imposed by the Committee (the date on which restrictions lapse
as to any shares of Restricted Stock or Restricted Stock
Units, the "Vesting Date"). The Committee may determine, as to
any grant of Restricted Stock and/or Restricted Stock Units,
that the restrictions shall lapse without regard to any
Restricted Period.
(b) Upon the lapse of restrictions with respect to any Restricted
Stock Units, the value of such Restricted Stock Units shall be
paid to the Grantee in shares of Common Stock. For purposes of
the preceding sentence, each Restricted Stock Unit as to which
restrictions have lapsed shall have a value equal to the Fair
Market Value as of the Units Vesting Date. "Units Vesting
Date" means, with respect to any Restricted Stock Units, the
date on which restrictions with respect to such Restricted
Stock Units lapse.
SECTION 11 EFFECT OF TERMINATION OF EMPLOYMENT
11.1 Termination Generally
(a) Except as provided in Section 11.2, 11.3 or 12, or as determined by
the Committee, in its sole discretion, all rights to exercise the
vested portion of any Option held by an Optionee or of any Stock
Appreciation Right Award held by a Grantee whose employment or
relationship (if a non-employee) with the Company or service on the
Board is terminated for any reason other than "Cause," as defined
below, shall terminate ninety (90) days following the date of
termination of employment or the relationship or service on the Board,
as the case may be. All rights to exercise the vested portion of any
Option held by an Optionee or of any Stock Appreciation Right Award
held by a Grantee whose employment or relationship (if a non-employee)
with the Company is terminated for "Cause" shall terminate on the date
of termination of employment or the relationship. For the purposes of
this Plan, "Cause" shall mean a finding by the Committee that the
Optionee has engaged in conduct that is fraudulent, disloyal, criminal
or injurious to the Company, including, without limitation, acts of
dishonesty, embezzlement, theft, felonious conduct or unauthorized
disclosure of trade secrets or confidential information of the
Company. Unless otherwise provided in the Plan or determined by the
Committee, vesting of Options and Stock Appreciation Right Awards
ceases immediately upon termination of employment, or the date of
termination of the relationship with the Company, and any portion of
an Option and/or Stock Appreciation Right Award that has not vested on
or before the date of such termination is forfeited on such date.
(b) If a Grantee who has received an Award of Restricted Stock and/or
Restricted Stock Units ceases to be employed by the Company during the
Restricted Period, or if other specified conditions are not met, the
Award of Restricted Stock and/or Restricted Stock Units shall
terminate as to all shares covered by the Award as to which the
restrictions have not lapsed, and, in the case of Restricted Stock,
those shares of Common Stock shall be canceled in exchange for the
purchase price, if any, paid by the Grantee for such shares. The
Committee may provide, however, for complete or partial exceptions to
this requirement as it deems appropriate.
(c) The transfer of employment from the Company to a Subsidiary, or from a
Subsidiary to the Company, or from a Subsidiary to another Subsidiary,
shall not constitute a termination of employment for purposes of the
Plan. Awards granted under the Plan shall not be affected by any
change of duties in connection with the employment of the Key Employee
or by a leave of absence authorized by the Company.
11.2 Death and Disability
In the event of the death or Disability (as defined below) of
an Optionee or Grantee during employment or such Optionee's or Grantee
relationship with the Company or service on the Board, (a) all Options
held by the Optionee and all Stock Appreciation Right Awards held by
the Grantee shall become fully exercisable on such date of death or
Disability and (b) all restrictions and conditions on all Restricted
Stock and/or Restricted Stock Units held by the Grantee shall lapse on
such date of death or Disability. Each of the Options held by such an
Optionee and each of the Stock Appreciation Right Awards held by such a
Grantee shall expire on the earlier of (i) the first anniversary of the
date of death or Disability and (ii) the date that such Option or Stock
Appreciation Right Award expires in accordance with its terms, provided
that, in any event, NSOs granted under this Plan shall not expire
earlier than one year from the date of death or disability. For
purposes of this Section 11.2, "Disability" shall mean the inability of
an individual to engage in any substantial gainful activity by reason
of any medically determinable physical or mental impairment which is
expected to result in death or which has lasted or can be expected to
last for a continuous period of not less than twelve (12) months. The
Committee, in its sole discretion, shall determine the existence and
date of any Disability.
11.3 Retirement
(a) Key Employees. In the event the employment of a Key Employee with the
Company shall be terminated by reason of "Normal Retirement" or "Early
Retirement," as defined below, all Options and Stock Appreciation
Right Awards held by such Key Employee shall become fully exercisable
on the date of such Employee retirement. Each of the Options and Stock
Appreciation Right Awards held by such a Key Employee shall expire on
the earlier of (i) the fifth anniversary of the date of the Employee
retirement, or (ii) the date that such Option expires in accordance
with its terms. For the purposes hereof, "Normal Retirement" shall
mean retirement of a Key Employee at or after age 65 and "Early
Retirement" shall mean retirement of a Key Employee at or after age 60
with a minimum of 15 years of service with the Company. In the event
the employment of a Key Employee with the Company shall be terminated
by reason of a retirement that is not an Normal Retirement or Early
Retirement, the Committee may, in its sole discretion, determine the
vesting, exercisability and exercise periods applicable to Options and
Stock Appreciation Right Awards held by such Key Employee. In the
event the employment of a Key Employee with the Company shall be
terminated by reason of "Normal Retirement" or "Early Retirement", all
restrictions and conditions on all Restricted Stock and/or Restricted
Stock Units held by such Key Employee shall lapse on the date of such
Normal Retirement or Early Retirement. In the event the employment of
a Key Employee with the Company shall be terminated by reason of a
retirement that is not a Normal Retirement or Early Retirement, the
Committee may, in its sole discretion, determine the restrictions and
conditions, if any, on Restricted Stock and/or Restricted Stock Units
held by such Key Employee that will lapse.
(b) Outside Directors. In the event the service on the Board of an Outside
Director shall be terminated by reason of the retirement of such
Outside Director in accordance with the Company's retirement policy
for members of the Board ("Outside Director Retirement"), all Options
and Stock Appreciation Right Awards held by such Outside Director
shall become fully exercisable on the date of such Outside Director
Retirement. Each of the Options and Stock Appreciation Right Awards
held by such an Outside Director shall expire on the earlier of (i)
the date that such Option or Stock Appreciation Right Award expires in
accordance with its terms or (ii) the five year anniversary date of
such Outside Director Retirement. In the event the service on the
Board of an Outside Director shall be terminated by reason of an
"Outside Director Retirement", all restrictions and conditions on all
Restricted Stock and/or Restricted Stock Units held by such Outside
Director shall lapse on the date of such Outside Director Retirement.
(c) Key Employees Who Are Employee Directors. Section 11.3(a) shall be
applicable to Options, Stock Appreciation Rights, Restricted Stock
and/or Restricted Stock Units held by any Key Employee who is an
Employee Director at the time that such Key Employee's employment with
the Company terminates by reason of Employee Retirement. If such Key
Employee continues to serve on the Board as of the date of such Key
Employee's Employee Retirement, then Section 11.3(b) shall be
applicable to Options, Stock Appreciation Rights Restricted Stock
and/or Restricted Stock Units granted after such date.
SECTION 12 CHANGE IN CONTROL
12.1 Effect of Change in Control
Notwithstanding any of the provisions of the Plan or any
written agreement or grant certificate evidencing Awards granted
hereunder, immediately upon a "Change in Control" (as defined in
Section 12.2), all outstanding Options and Stock Appreciation Rights
granted to Key Employees or Outside Directors, whether or not otherwise
exercisable as of the date of such Change in Control, shall accelerate
and become fully exercisable and all restrictions thereon shall
terminate in order that Optionees and Grantees may fully realize the
benefits thereunder, and all restrictions and conditions on all
Restricted Stock and Restricted Stock Units granted to Key Employees or
Outside Directors shall lapse upon the effective date of the Change of
Control. The Committee may determine in its discretion (but shall not
be obligated to do so) that any or all holders of outstanding Options
and Stock Appreciation Right Awards which are exercisable immediately
prior to a Change of Control (including those that become exercisable
under this Section 12.1) will be required to surrender them in exchange
for a payment, in cash or Common Stock as determined by the Committee,
equal to the value of such Options and Stock Appreciation Right Awards
(as determined by the Committee in its discretion), with such payment
to take place as of the date of the Change in Control or such other
date as the Committee may prescribe.
12.2 Definition of Change in Control
The term "Change in Control" shall mean the occurrence, at any
time during the term of an Award granted under the Plan, of any of the
following events:
(a) The acquisition, other than from the Company, by any individual,
entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of
the Exchange Act) (a "Person") (other than the Company or any benefit
plan sponsored by the Company) of beneficial ownership (within the
meaning of Rule 13d-3 under the Exchange Act) of 30% or more of either
(i) the then outstanding shares of the Common Stock (the "Outstanding
Common Stock") or (ii) the combined voting power of the then
outstanding voting securities of the Company entitled to vote
generally in the election of directors (the "Voting Securities"); or
(b) Individuals who, as of the Effective Date, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least
one-third (1/3) of the Board (rounded down to the nearest whole
number), provided that any individual whose election or nomination for
election was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board shall be considered as
though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial
assumption of office is in connection with an actual or threatened
election contest relating to the election of the Directors of the
Company; or
(c) Consummation by the Company of a reorganization, merger or
consolidation (a "Business Combination"), in each case, with respect
to which all or substantially all of the individuals and entities who
were the respective beneficial owners of the Outstanding Common Stock
and Voting Securities immediately prior to such Business Combination
do not, following such Business Combination, beneficially own,
directly or indirectly, more than 50% of, respectively, the then
outstanding shares of common stock and the combined voting power of
the then outstanding voting securities entitled to vote generally in
the election of directors, as the case may be, of the corporation
resulting from such Business Combination in substantially the same
proportion as their ownership immediately prior to such Business
Combination of the Outstanding Common Stock and Voting Securities, as
the case may be; or
(d) Consummation of a complete liquidation or dissolution of the Company,
or sale or other disposition of all or substantially all of the assets
of the Company other than to a corporation with respect to which,
following such sale or disposition, more than 50% of, respectively,
the then outstanding shares of common stock and the combined voting
power of the then outstanding voting securities entitled to vote
generally in the election of directors is then owned beneficially,
directly or indirectly, by all or substantially all of the individuals
and entities who were the beneficial owners, respectively, of the
Outstanding Common Stock and Voting Securities immediately prior to
such sale or disposition in substantially the same proportions as
their ownership of the Outstanding Common Stock and Voting Securities,
as the case may be, immediately prior to such sale or disposition.
(e) In addition to the foregoing, with respect to any Key Employee covered
under this provision, consummation by the Company of a Business
Combination, in each case, with respect to which all or substantially
all of the individuals and entities who were the respective beneficial
owners of the Outstanding Common Stock and Voting Securities
immediately prior to such Business Combination do not, following such
Business Combination, beneficially own, directly or indirectly, more
than 55% of, respectively, the then outstanding shares of common stock
and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors, as
the case may be, of the corporation resulting from such Business
Combination in substantially the same proportion as their ownership
immediately prior to such Business Combination of the Outstanding
Common Stock and Voting Securities, as the case may be, and any Key
Employees who were employed by the Company and were Optionees or
Grantees under the Plan at the time of such Business Combination is
terminated other than for Cause or voluntarily leaves the employ of
the Company within two (2) years from the date of any such Business
Combination as the result of a voluntary termination of employment by
such Key Employee within sixty (60) days after any one or more of the
following events have occurred:
(i) failure by the Company to maintain
the duties, status, and
responsibilities of the Key Employee
substantially consistent with those
prior to the Business Combination,
or
(ii) a reduction by the Company in the
Key Employee's base salary as in
effect as of the date prior to the
Business Combination, or
(iii) the failure of the Company to
maintain and to continue the Key
Employee's participation in the
Company's benefit plans as in effect
from time to time on a basis
substantially equivalent to the
participation and benefits of
Company employees similarly situated
to the Employee.
SECTION 13 RIGHTS AS STOCKHOLDER
Except as provided in Section 10.4 with respect to an Award of
Restricted Stock or Restricted Stock Units, an Optionee or Grantee (or
a transferee of any such person pursuant to Section 9) shall have no
rights as a stockholder with respect to any Common Stock covered by an
Award or receivable upon the exercise of Award until the Optionee,
Grantee or transferee shall have become the holder of record of such
Common Stock, and no adjustments shall be made for dividends in cash or
other property or other distributions or rights in respect to such
Common Stock for which the applicable record date is prior to the date
on which the Optionee or Grantee shall have become the holder of record
of the shares of Common Stock purchased pursuant to exercise of the
Award.
SECTION 14 POSTPONEMENT OF EXERCISE
The Committee may postpone any exercise of an Option or Stock
Appreciation Right Awards for such time as the Committee in its sole discretion
may deem necessary in order to permit the Company to comply with any applicable
laws or rules, regulations or other requirements of the Securities and Exchange
Commission or any securities exchange or quotation system upon which the Common
Stock is then listed or quoted. Any such postponement shall not extend the term
of an Option or Stock Appreciation Right Award, unless such postponement extends
beyond the expiration date of the Award in which case the expiration date shall
be extended thirty (30) days, and neither the Company nor its directors,
officers, employees or agents shall have any obligation or liability to an
Optionee or Grantee, or to his or her successor or to any other person.
SECTION 15 TAXES
15.1 Taxes Generally
The Company shall have the right to withhold from any Award,
from any payment due or transfer made under any Award or under the Plan
or from any compensation or other amount owing to a participant the
amount (in cash, shares or other property) of any applicable
withholding or other taxes in respect of an Award, its exercise, or any
payment or transfer under an Award or under the Plan and to take such
other action as may be necessary in the opinion of the Committee to
satisfy all obligations for the payment of such taxes.
15.2 Payment of Taxes
A participant, with the approval of the Committee, may satisfy
the obligation set forth in Section 15.1, in whole or in part, by (a)
directing the Company to withhold such number of shares of Common Stock
otherwise issuable upon exercise or vesting of an Award (as the case
may be) having an aggregate Fair Market Value on the date of exercise
equal to the amount of tax required to be withheld, or (b) delivering
shares of Common Stock of the Company having an aggregate Fair Market
Value equal to the amount required to be withheld on any date. The
Committee may, in its sole discretion, require payment by the
participant in cash of any such withholding obligation and may
disapprove any election or delivery or may suspend or terminate the
right to make elections or deliveries under this Section 15.2.
SECTION 16 TERMINATION, AMENDMENT AND TERM OF PLAN
16.1 The Board or the Committee may terminate, suspend, or amend the Plan,
in whole or in part, from time to time, without the approval of the
stockholders of the Company provided, however, that no Plan amendment
shall be effective until approved by the stockholders of the Company if
the effect of the amendment is to lower the exercise price of
previously granted Options or Stock Appreciation Rights or if such
stockholder approval is required in order for the Plan to continue to
satisfy the requirements of Rule 16b-3 under the 1934 Act or applicable
tax or other laws.
16.2 The Committee may correct any defect or supply any omission or
reconcile any inconsistency in the Plan or in any Award granted
hereunder in the manner and to the extent it shall deem desirable, in
its sole discretion, to effectuate the Plan. No amendment or
termination of the Plan shall adversely affect any Award theretofore
granted without the consent of the receipient, except that the
Committee may amend the Plan in a manner that does affect Awards
theretofore granted upon a finding by the Committee that such amendment
is in the best interests of holders of outstanding Options affected
thereby.
16.3 The Plan became effective as of March 22, 2002. An amendment and
restatement of the Plan has been adopted and authorized by the Board of
Directors for submission to the stockholders of the Company for their
approval. If the Plan, as amended and restated, is approved by the
stockholders of the Company, the amendment and restatement shall be
deemed to have become effective as of May 11, 2005. Unless earlier
terminated in accordance herewith, the Plan shall terminate on March
22, 2012. Termination of the Plan shall not affect Awards previously
granted under the Plan.
SECTION 17 GOVERNING LAW
The Plan shall be governed and interpreted in accordance with the laws
of the State of Delaware, without regard to any conflict of law provisions which
would result in the application of the laws of any other jurisdiction.
SECTION 18 NO RIGHT TO AWARD; NO RIGHT TO EMPLOYMENT
No person shall have any claim of right to be granted an Award under
the Plan. Neither the Plan nor any action taken hereunder shall be construed as
giving any employee of the Company any right to be retained in the employ of the
Company or as giving any member of the Board any right to continue to serve in
such capacity.
SECTION 19 AWARDS NOT INCLUDABLE FOR BENEFIT PURPOSES
Income recognized by a participant pursuant to the provisions of the
Plan shall not be included in the determination of benefits under any employee
pension benefit plan (as such term is defined in Section 3(2) of the Employee
Retirement Income Security Act of 1974) or group insurance or other benefit
plans applicable to the participant which are maintained by the Company, except
as may be provided under the terms of such plans or determined by resolution of
the Committee.
SECTION 20 NO STRICT CONSTRUCTION
No rule of strict construction shall be implied against the Company,
the Committee, or any other person in the interpretation of any of the terms of
the Plan, any Award granted under the Plan or any rule or procedure established
by the Board.
SECTION 21 CAPTIONS
All Section headings used in the Plan are for convenience only, do not
constitute a part of the Plan, and shall not be deemed to limit, characterize or
affect in any way any provisions of the Plan, and all provisions of the Plan
shall be construed as if no captions have been used in the Plan.
SECTION 22 SEVERABILITY
Whenever possible, each provision in the Plan and every Award at any
time granted under the Plan shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of the Plan or
any Award at any time granted under the Plan shall be held to be prohibited by
or invalid under applicable law, then such provision shall be deemed amended to
accomplish the objectives of the provision as originally written to the fullest
extent permitted by law, and all other provisions of the Plan and every other
Award at any time granted under the Plan shall remain in full force and effect.
SECTION 23 MODIFICATION FOR GRANTS OUTSIDE THE U.S.
The Board may, without amending the Plan, determine the terms and
conditions applicable to grants of Awards to participants who are foreign
nationals or employed outside the United States in a manner otherwise
inconsistent with the Plan if the Board deems such terms and conditions
necessary in order to recognize differences in local law or regulations, tax
policies or customs.
AMENDMENTS TO THE
DENTSPLY INTERNATIONAL INC.
2002 AMENDED & RESTATED EQUITY INCENTIVE PLAN
(The "Plan")
EFFECTIVE JULY 1, 2005
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Paragraphs 5.1 and 5.5 of the Plan are amended by replacing Paragraphs 5.1 and
5.5 of the Plan with the following paragraphs:
5.1 Grants
All grants of Options to Outside Directors shall be automatic and
non-discretionary. Each individual who becomes an Outside Director (other than
an Outside Director who was previously an Employee Director) shall be granted a
NSO to purchase ten thousand (10,000) shares of Common Stock on the date he or
she becomes an Outside Director. Each individual who is an Employee Director and
who thereafter becomes an Outside Director shall be granted automatically a NSO
to purchase ten thousand (10,000) shares of Common Stock on the third
anniversary of the date such Employee Director was last granted an Option.
Thereafter, each Outside Director who holds NSOs granted under this Section 5
and is re-elected to the Board shall be granted an additional NSO to purchase
ten thousand (10,000) shares of Common Stock on the third anniversary of the
date such Outside Director was last granted an Option.
5.5 Restricted Stock, Restricted Stock Units and Stock Appreciation Rights
Notwithstanding the foregoing, the Board of Directors may determine that, in
lieu of being granted NSOs as described in this Section 5, an Outside Director
shall be granted an Award of shares of Restricted Stock, Restricted Stock Units
and/or Stock Appreciation Rights as described in Section 8 or 10 hereof which,
at the time of grant, for the same value as 10,000 Options as determined by the
method the Company uses to value Awards. In any such event, the restrictions as
to such Award of Restricted Stock and/or Restricted Stock Units shall lapse, and
any such Award of Stock Appreciation Rights shall vest, in accordance with the
vesting schedule set forth in Section 5.4.